Update on IRS Identity Theft Crackdown

The IRS, in conjunction with the Justice Department and other Federal, state, and local agencies, has intensified their efforts at preventing, detecting, and resolving identity theft and refund fraud. Read more

The identity theft and refund fraud effort has involved 734 enforcement actions in January involving 389 individuals. The effort included 109 arrests, 189 indictments and complaints, and 47 search warrants. Read more

In addition, the IRS began a special compliance effort that began on January 28, 2013. IRS auditors and criminal investigators will visit 197 money service businesses to help make sure that these businesses are not assisting identity thieves or refund fraud when cashing checks. These compliance visits took place in 17 high-risk areas identified by the IRS which included: New York, Philadelphia, Atlanta, Tampa, Miami, Chicago, Houston, Phoenix, Los Angeles, San Diego, El Paso, Tucson, Birmingham, Detroit, San Francisco, Oakland, and San Jose. Read more

Click here to read the entire CrossLink Tax Update about the IRS identity theft crackdown.

Tax Update: IRS and Schedule C Due Diligence Letters and Visits

As part of the IRS’s continued efforts to increase paid preparer accuracy and due diligence in preparing tax returns, the IRS has begun to focus on returns that include a Schedule C. This past November and last month (January 2013) the IRS sent out 4,000 letters to preparers whom had been identified as preparing Schedule C’s that may have contained errors. Read more

In November, 1,200 return preparers received a letter informing them that the IRS would be conducting an educational visit to go over their responsibilities in preparing returns containing a Schedule C.

Click here to read more about the IRS and Schedule C Due Diligence Letters and Visits, as well as to view IRS Letters 4810, 5102, and 5105 for further details.